JUDGMENT

P. R. GOKULAKRISHNAN, J.

( 1 ) IN this Group of writ petitions the petitioners are industrial concerns which had taken loans from the respondent-Gujarat State Financial Corporation (hereinafter referred to as Corporation or the GSFC) and executed agreement and deeds of mortgage/pledge/hypothecation. They have made defaults in repayment of the loan and installments thereof and in meeting with their obligations to the respondent-Corporation. The respondent Corporation had therefore resorted to Sec. 29 (1) of the State Financial Corporation Act 1951 (Act No. 63 of 1951) where under the State Financial Corporation has been conferred a right to take over the management or position or both of the industrial concern as well as the right to transfer by way of lease or sale and realise the property pledged mortgaged hypothecated or assigned to the Financial Corporation.

( 2 ) THE petitioners have therefore challenged the constitutional validity of Sec. 9 (1) of the Act and in the alternative the action threatened or taken under that provision. Section 29 (1) of the Act reads as under: 291 Where any industrial concern which is under a liability to the Financial Corporation under agreement makes any default in repayment of any loan or advance or any installment there of or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply with the terms of if agreement with the Financial Corporation the Financial Corporation shall have the tight to take over the management or possession or both the industrial concern as well as the right to transfer by way of lease or sale and release the property pledged mortgaged hypothecated or assigned to the Financial Corporation.

( 3 ) THE learned Counsel appearing for the petitioners have contended that this provision is unreasonable drastic arbitrary violative of the principles of natural justice and fair play the Corporation behaves as a Judge in its own cause and executes its own decision as its unguarded sweet will there is no hearing no reasoned order no consideration for revival of viable sick unit no safeguard no corrective machinery no appeal revision or review no guideline no procedure no natural justice no fair play and this unreasonable provision enables the respondent-Corporation to take possession and transfer the industrial concern at any price without following any procedure to any person and therefore this provision is utterly arbitrary unreasonable and violative of Arts. 14 19 21 and 300a of the Constitution.

( 4 ) SECONDLY it is contended that covering the same field of default by the industrial concern another remedy is provided by Sec. 31 of the Act whereby the Corporation has been Given an expeditious judicial remedy by way of a mere application to the District Judge for an order of sale or transfer of the management of the industrial concern and also for ad interim injunction against the industrial concern. This judicial remedy directly to the District Judge is held to be in the nature of an execution application and therefore it is a summary and expeditious remedy through Court. As against that the other direct action without intervention of the Court provided by way of Sec. 29 of the Act is very drastic and the Corporation which is an authority of the State has absolute discretion to pick and choose an industrial concern against when it would proceed under Sec. 29 (1) and not proceed against other similarly situated under Sec. 29 (1) and instead proceed against them under Sec. 31 (1) of the Act by approaching the District Judge. Thus the existence of these two remedies gives arbitrary power to the Corporation and therefore Sec. 29 (1) is violative of the guarantee of equality under Act. 14 of the Constitution of india It is also submitted that the Corporation has similar remedy under the Gujarat Public Money (Recovery of Dues) Acts 1979. It is also an effective remedy for recovery of its dues. In these circumstances the auth